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December 01, 2006

In re Rivastigmine Patent Litigation (S.D.N.Y. 2006)

Communications to Swiss Patent Agents Held Not Subject to Privilege

By Robert Dailey --

A discovery order in the ongoing ANDA litigation over
Exelon (In re Rivastigimine, No. 05-MD-1661-HB, S.D.N.Y.) held that
attorney-client privilege does not attach to communications between Novartis
and its Swiss patent agent.

Communications to foreign patent agents are covered by
the law of the country where the application is pending. A U.S. court, therefore, must decide whether
the law of that country embodies legal protections comparable to our
attorney-client privilege. Previous
holdings have found the existence such protections under the laws of Japan, for
example.

Novartis argued that Swiss law protects communications to
patent agents in ways that are comparable to U.S. privilege provisions. The Swiss statutes proffered by Novartis,
however, refer only to a professional secrecy obligation, and not to an
absolute evidentiary privilege. Defendants
(Dr. Reddy's, Watson, and Sun) argued that the court should focus on the text
of the Swiss statutes, and recognize that they create only a qualified
privilege of confidentiality

.

Novartis disagreed with the Defendants' interpretation of
the Swiss statutes. But Novartis offered
a second argument as well, asking
the court to look past the text of the Swiss statutes and consider the effects
of those provisions within the context of Swiss discovery rules. Since Swiss litigation practice permits only
limited discovery, confidentiality is sufficient to protect communications
between clients and their patent agents from disclosure.

This effects-based approach seems to get closer to the
real question that our federal courts should be asking: Would the communication at issue be protected
under the legal practices of the foreign country? But the text-based approach elevates form
over function by focusing only on whether the foreign country has a privilege
doctrine commensurate with ours. Nevertheless, the district court adopted the Defendants' textual
arguments, holding that the Swiss law would permit a court to "order
disclosure if it determines that the need for the information is sufficient to
outweigh the secrecy obligation."